Risk Insider: Tony Boobier

Work Stress as a Risk

By: | February 28, 2018 • 3 min read
Tony Boobier is an experienced independent consultant focusing on insurance analytics. An international speaker, commentator and published author, he lies awake at night thinking about the convergence of insurance and technology. He can be reached at [email protected]

Ever felt bullied at work or been faced with what seems like an impossible target or deadline?

The creation and maintenance of stressful workplace conditions for employees sits front and center in our modern working environment, raises the potential for new and significant liabilities, and is an issue which cannot continue to be ignored.

I posit that workers’ compensation and employment liability insurers better be on the lookout.

The recent publicity into Hollywood (mis) behaviors, tagged as #MeToo, has the potential to open up other proverbial cans of worms for multiple adverse practices in the workplace.

Stress is a big deal. In the workplace, it’s more strongly associated with health complaints than with family or financial issues. People are becoming less shy about work absence through work-related stress.

It’s an all-too-common phenomenon. According to the American Institute of Stress, a charitable organisation dedicated to ‘Transforming stress through awareness, education and collaboration’:

  • 40 percent of workers reported their job was very or extremely stressful
  • 25 percent view their jobs as the number one stressor in their lives
  • Three-fourths of employees believe that workers have more on-the-job stress than a generation ago
  • 29 percent of workers felt quite a bit or extremely stressed at work
  • 26 percent of workers said they were “often or very often burned out or stressed by their work”

Stress at work occurs due to:

  • Workload, underpinned by poor job design accompanied by loss of control and management style (46 percent)
  • Lack of job security, reflecting not only an increasingly volatile work environment but also the failure of the individual to meet impossible targets (6 percent)
  • People issues, including the absence of support from (equally stressed) co-workers (28 percent)
  • Work-life balance, surely influenced by the increased impact of rarely being out of contact (20 percent)

I can’t help but wonder how this situation occurred.

Was it an inevitable by-product of the Industrial Age, now with us for over a century, since Ford and Pullman (amongst others) considered humans as being simply a component of the production line? Has the relentless march towards profitability in a volatile business environment increasingly created new mega-stresses?

Stress is a big deal. In the workplace, it’s more strongly associated with health complaints than with family or financial issues. People are becoming less shy about work absence through work-related stress.

Or have matters gotten worse with the increasing impact of advanced performance tools, which give organizations deep insight to worker productivity and behavior? If the latter, then surely it can’t be fair to blame providers of performance management software, can it? After all, performance management technology vendors don’t set the parameters for individual, departmental or company performance any more than gun manufacturers choose their customers or victims.

There’s an obvious potential liability on employers for creating stress in the workplace. Employees invariably will be faced with proving the stress is work-related rather than for any other reason. And as they say, if you don’t like the heat, get out of the kitchen.

But doesn’t it increasingly feel a little like employers and businesses are beginning to stand on thinner ice, in terms of their obligation to employees and the inevitable liabilities that might arise from stress in the workplace?

Are insurers simply going to stand back and wait for the first ‘class action’ or be more proactive in some way? And if so, how?

When will the scale of work-related stress come out of the closet and be revealed as being as pervasive in industry as that of sexual harassment? With over half the workforce affected by stress in some way, doesn’t #MeTooTwo also have the potential to hit the headlines?

More from Risk & Insurance

More from Risk & Insurance

2018 Risk All Stars

Stop Mitigating Risk. Start Conquering It Like These 2018 Risk All Stars

The concept of risk mastery and ownership, as displayed by the 2018 Risk All Stars, includes not simply seeking to control outcomes but taking full responsibility for them.
By: | September 14, 2018 • 3 min read

People talk a lot about how risk managers can get a seat at the table. The discussion implies that the risk manager is an outsider, striving to get the ear or the attention of an insider, the CEO or CFO.

Advertisement




But there are risk managers who go about things in a different way. And the 2018 Risk All Stars are prime examples of that.

These risk managers put in gear their passion, creativity and perseverance to become masters of a situation, pushing aside any notion that they are anything other than key players.

Goodyear’s Craig Melnick had only been with the global tire maker a few months when Hurricane Harvey dumped a record amount of rainfall on Houston.

Brilliant communication between Melnick and his new teammates gave him timely and valuable updates on the condition of manufacturing locations. Melnick remained in Akron, mastering the situation by moving inventory out of the storm’s path and making sure remediation crews were lined up ahead of time to give Goodyear its best leg up once the storm passed and the flood waters receded.

Goodyear’s resiliency in the face of the storm gave it credibility when it went to the insurance markets later that year for renewals. And here is where we hear a key phrase, produced by Kevin Garvey, one of Goodyear’s brokers at Aon.

“The markets always appreciate a risk manager who demonstrates ownership,” Garvey said, in what may be something of an understatement.

These risk managers put in gear their passion, creativity and perseverance to become masters of a situation, pushing aside any notion that they are anything other than key players.

Dianne Howard, a 2018 Risk All Star and the director of benefits and risk management for the Palm Beach County School District, achieved ownership of $50 million in property storm exposures for the district.

With FEMA saying it wouldn’t pay again for district storm losses it had already paid for, Howard went to the London markets and was successful in getting coverage. She also hammered out a deal in London that would partially reimburse the district if it suffered a mass shooting and needed to demolish a building, like what happened at Sandy Hook in Connecticut.

2018 Risk All Star Jim Cunningham was well-versed enough to know what traditional risk management theories would say when hospitality workers were suffering too many kitchen cuts. “Put a cut-prevention plan in place,” is the traditional wisdom.

But Cunningham, the vice president of risk management for the gaming company Pinnacle Entertainment, wasn’t satisfied with what looked to him like a Band-Aid approach.

Advertisement




Instead, he used predictive analytics, depending on his own team to assemble company-specific data, to determine which safety measures should be used company wide. The result? Claims frequency at the company dropped 60 percent in the first year of his program.

Alumine Bellone, a 2018 Risk All Star and the vice president of risk management for Ardent Health Services, faced an overwhelming task: Create a uniform risk management program when her hospital group grew from 14 hospitals in three states to 31 hospitals in seven.

Bellone owned the situation by visiting each facility right before the acquisition and again right after, to make sure each caregiving population was ready to integrate into a standardized risk management system.

After consolidating insurance policies, Bellone achieved $893,000 in synergies.

In each of these cases, and in more on the following pages, we see examples of risk managers who weren’t just knocking on the door; they were owning the room. &

____________________

Risk All Stars stand out from their peers by overcoming challenges through exceptional problem solving, creativity, clarity of vision and passion.

See the complete list of 2018 Risk All Stars.

Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]